Setting up VAT for Orders

VAT taxation for Orders involves applying VAT to product categories, individual products, and freight and handling charges. Unless a customer has a nontaxable status, VAT freight and handling taxes are calculated on both taxable and nontaxable product purchases. Whether tax applies depends on the location of the customer relative to the organization; if the customer is:

  • in the same EU country, VAT applies
  • in a different EU country but has no VAT number (private person, some types of organizations), VAT applies
  • in a different EU and has a VAT number, VAT does not apply
  • outside the EU, VAT does not apply

Warning!  

Tax settings at the product level override those at the category level. That is, if you enable taxes for a category but not for a product in that category, no taxes are calculated; if you disable taxes for a category but enable them for a product in that category, taxes are calculated.

Best practice: Before applying VAT tax codes to products and product categories, consult with an expert on VAT rules and regulations.

Note: Tip: You can override any applied VAT taxes at order entry.

Before you begin

  1. Enable the VAT method.
  2. Define the VAT codes.
  3. Verify the Default country for the website (RiSE > Set up web components > General configuration).

To apply taxation to a product in AR/Cash

  1. From AR/Cash, select Set up tables > Products to open the Set up products window.
  2. Select a product code from the list of Current Products.
  3. Click Edit.
  4. Enable the Taxable option. The Tax Code field displays when the Taxable option is enabled.
  5. Enter a VAT Tax Code for the product, or select the find icon to look up a tax code.
  6. Click Save.

To apply taxation to a product category

  1. From Orders, select Set up tables > Product categories to open the Set up product categories window.
  2. Select a product category from the list of Current Categories.
  3. Click Edit.
  4. Enable the Taxable category option. The Tax Code field displays when the Taxable option is enabled.
  5. Enter a VAT Tax Code for the product, or select the find icon to look up a tax code.
  6. Click Save.

To apply taxation to a single product

  1. From Orders, select Manage inventory > Manage products to open the Manage products window.
  2. Select a product code from the list of Current Products.
  3. Click Edit.
  4. Enable the Taxable option. The Tax Code field displays when the Taxable option is enabled.
  5. Enter a VAT Tax Code for the product, or select the find icon to look up a tax code.
  6. Click Save.

To apply taxation to freight and handling charges

  1. From Orders, select Set up module to open the Set up module window.
  2. Click Add-On Charges to open the Add-on Charges window.
  3. Click Edit.
  4. Enable the Apply Sales Tax to Freight Charges and Apply Sales Tax to Handling Charges options. The Freight and Handling Tax field displays.
  5. Enter a VAT tax code in the Freight and Handling Tax field, or select the find icon to look up a tax code.
  6. Click Save.